<p>
  Stock options are traded in units. Each contract entitles the option buyer/owner 100 shares of the underlying stock upon expiration. Thus, if you buy five call option contracts, you are acquiring the right to purchase 500 shares at expiration.  For any given asset at any given time, an option can be bought or sold with multiple expiration dates and strikes. Suppose there are three expiration dates and four strike prices for options on a particular stock, there are a total of 24 different contracts if we consider both put and call options. Currently, all equity options traded on U.S. options exchanges are American-style. But many index options are European-style.
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<p>
  Let us use the example of Apple. You can buy and sell Apple shares (NASDAQ: AAPL), and you can also buy and sell Apple options. But not all stocks have options associated with them. This means that there may be no options available to buy or sell written on a certain stock. You can view the websites of the exchanges to find out which stocks do have options.
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<p>
  In this case, the stock AAPL is known as the underlying asset. The share price of AAPL is the underlying price. And a series of options contracts written on Apple are derivatives. Option contracts have their own symbols. For example, AAPL170728C00143000 is one of the option contracts, it is a call option and the strike price is $143. The contract expires on July 28th. The premium for this contract is $10. If you spend $10 cost on buying one contract, then you get the right to buy 100 shares of AAPL for $143 per share at any time before the expiration date.
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